15 July, 1908.]

Chairman-continued.

(as it is in the present Act) "before the commencement of the winding-up"; . and what we propose is during the 18 months before the presentation of the petition.

222. The dates are identical?-Yes. It always begins when the petition is presented.

223. It merely means this, that words the effect of which it is easier to understand, are substituted for others that mean the same?—Yes.

(After some discussion.)

Chairman.

224. If there is any objection at all to the words we had better leave it as it stands in the Act. It may be clearer as proposed here, but still it is better to leave it as it stands in the Act. Then in Subclause 1 (b) the word "contributory has been substituted for "shareholder of the company." You would not contend that those are synonymous terms?-No, that I presume will come out.

[Chairman.] Yes, we will leave it as it stands in the Act. The Committee does not accept either of the proposed alterations as they appear in the notes on Clause 138.

ON CLAUSE 140.

Chairman.

225. In Clause 140 the word "first" is inserted before the word "petition," that is giving effect to the decision in Kent v. the Freehold Land Company?-Yes, it gives effect to the decision in that case.

226. Is that a case of the interpretation of the Statute itself?-It is the interpretation of this particular section reproduced here.

227. Is that a decision by the House of Lords? -No; it is in the Court of Appeal.

Mr. Beale.

228. Has there ever been any doubt about this, that if an order is made on two or three petitions, the date on which the winding up commences would be the time of the presentation of the first petition; is it necessary to say so in words?There appears to have been litigation about it. Chairman.

229. But the litigation has been happily settled and concluded ?—Yes.

230. Therefore if anyone were in doubt, he would just look up his Buckley, and he would see that this clause had been interpreted in such and such a case as meaning so and so, and that being so you need not incorporate the decision. If you keep the words the same as in the old Act there would be no difficulty-the words have been interpreted?--Yes.

[Chairman.] We will restore the words as they stood in the old Act.

ON CLAUSE 141. Chairman.

231. I see Clause 141 has been modified; does this amount to an amendment of the law?-I W

Chairman-continued.

[Continued.

believe the clause as it stands represents the existing law, having regard to the changes made by the Judicature Act.

232. I gather that the wording of the clause has been modified in order to bring it into harmony with the Judicature Act and the decisions in the two cases named in the note, viz., re Artistic Colour Printing Company (14 Ch. D. 502) and re General Service Co-operative Stores (1891 1 Ch. 496). As regards the Judicature Act I think we are agreed as to that; but as regards the decisions, can you say how far the decisions require an alteration of language?-The whole thing is rather a mosaic, and I cannot say exactly at the moment how that is.

233. Perhaps you would like it to stand over for the present?-Yes, if your Lordship pleases.

ON CLAUSE 144.

Chairman.

234. As regards Clause 144, is there any alteration of the law there?—Yes. I had better read to your lordship the present section, that will make it plain. The present section provides that" when an order has been made for winding up a company under this Act, a copy of such order shall forthwith be forwarded by the company to the Registrar of Joint Stock Companies, who shall make a minute thereof in his books relating to the company." At the present time in England that is not done, because a rule says that the copy is not to be forwarded by the company, but by the Official Receiver. (Mr. Barnes.) Perhaps I might tell your Lordships exactly what happens. When the winding-up order is made the Registrar of the Court sends over immediately to the Official Receiver, and the Official Receiver forwards a notice of the winding up to the Registrar of Joint Stock Companies. In that way the notice of the winding up gets on to the Registrar of Joint Stock Companies' file directly. It was found when it was left to the company to do it, directly an order had been made against the Company it was nobody's duty in particular to do it, and nobody did it. The result was that a rule was made by the Lord Chancellor saying that the Official Receiver should always forward notice of the winding up to the Registrar of Joint Stock Companies. That has always been done. This clause embodies that

rule.

235. The rule made was a rule in addition to the Statute ?--In addition to the Statute.

236. Therefore it stands now in this way: That there is a rule within the powers of making rules that the Official Receiver should do it; there is a Statute that the company shall do it? -Yes.

237. And the company never does it ?—Yes. 238. What is proposed here is to say that the Official Receiver shall do it in England, not requiring the company to do it ?-That is so.

239. Why should you not say the company, and, if you like, the Official Receiver also, because that is the present law, as I understand. The Lord Chancellor would be able to make another rule saying that the Official Receiver should do it, would he not ?--Yes.

15 July, 1908.]

Continued.

Chairman.-continued.

240. Is not the best way to leave the Statute as it was? The rule-making power is still retained in this Bill, is it not?-Yes.

241. That could be done without altering the wording of the Act?—Yes.

[Chairman.] We will leave the language as it

248. Where does the word occur?-It is in the third line of Subsection (1).

249. It reads, "The Court may at any time, after making a winding-up order, and either before or after it has ascertained the sufficiency of the assets of the Company." That means ascertaining what the assets suffice for ?-The suggestion was that if the assets of the company are sufficient you do not want to make a call at all.

[Chairman.] But "sufficiency" in that interpretation assumes that you mean sufficient for all the purposes of the company. I think "sufficiency" is all right. We will leave it "sufficiency," as it is in the Act.

Chairman-continued.

words in brackets in line 17 to line 19 should be left out.

[Chairman.] Then those words will be omitted.

ON CLAUSE 176. Chairman.

"The

251. As regards Clause 176, you say, language of the clause is altered to express the effect of the decision of the House of Lords in ex parte Barnes ?-Yes, the litigant is here, and he could tell your Lordship all about it.

252. (To Mr. Barnes.) Was I one of the judges taking part in that decision ?--No, it was before your Lordship became Lord Chancellor. Shall I tell your Lordship what the decision was?

253. If you please?-There is a section in the Companies (Winding-up) Act of 1890 which provides that the Official Receiver may make a further report, and the question arose on the language of that section, Section 8, as to whether it was necessary that a charge of fraud should be made against definite persons in that report, or whether it was only necessary that a general statement that fraud had been committed by somebody, without specifying whom, should be made at the end of the report. The House of Lords held that a general statement that fraud had been committed by somebody did not give the Court jurisdiction to make the order for a public examination, but that the persons who had committed the fraud must be pointed at in the report.

254. I remember the case perfectly well, and I remember the extreme difficulty that arose in regard to that question. I had thought that we had altered that in the Act of last year. Did not our Committee last year recommend something to that effect?--You did not make any alteration, you assumed that the alteration had been made by the House of Lords. I think that this clause as drawn really represents the old section of the Act of 1890, with the House of Lords' decision. incorporated in it.

255. Then the House of Lords' decision was a gloss upon the language of the section ?-Yes.

256. Then why not leave the language as it is in the section ? - -The House of Lords' decision will apply to the same language again. If we put the same language in this Bill there will still be the existing gloss. I think it would be better to leave the words that have been interpreted by the House of Lords? That is one way of doing it; we thought that this made it clearer. It is as your Lordship pleases.

[Chairman.] The other would probably be an improvement in the drafting, because if it were not ambiguous it would never have come to the House of Lords; but my view is that there being a decision by the House of Lords on the Statute, we want to preserve the effect of it, and we had better keep it in the old words.

ON CLAUSE 177. Chairman.

257. The same thing applies to Clause 177. Here you have modified the language to give effect

15 July, 1908.]

259. What do you say about Clause 182; had we not better leave it as it is in the Act ?-I should like to suggest to the Committee that if you do leave it as it is in the Act you will be really altering the law.

260. You mean because the restriction as to the time for giving notice of appeal has been superseded by the rules?-I would suggest to the Committee that the effect of rules made under the Jurisdiction Act is to get rid altogether of the previous statutory provisions relating to matters for which the rules provide, and that those statutory provisions are entirely dead, and have, in effect, been repealed by the Judicature Act. 261. You mean by the rules made under the Judicature Act ?—Yes.

Chairman continued.

[Continued.

267. Here, again, in Clause 185, the words it is dissolved" have been substituted for the words "its affairs are wound up." I think we had better leave the words of the Statute as they stand? The words are not accurate as they stand. Might I ask you to put the case down in the proposed schedule to be considered afterwards?

[Chairman.] Yes, I will note it for the proposed schedule.

268. In Clause 187 I see the word assets is substituted for "property "; does that make any real difference ?-I do not think so.

[Chairman.] I think we had better leave the word "property " as it is in the Statute.

ON CLAUSE 188. Chairman.

269. Then as regards Clause 188, that is only explanatory, is it not?-That is so.

ON CLAUSE 193. Chairman.

270. As regards Clause 193, I see you have a note; is there anything new there ?-There are some words inserted to give effect to the decisions in the various cases which are mentioned in the notes. I presume your Lordship would now wish to leave the words as they are in the Act. The first words proposed to be inserted are in Subclause (1): whether registered under this Act or not." It was proposed to insert those words in order to give effect to the decision in re Irrigation Company of France.

271. That has been decided on the words of the Statute already?—Yes.

272. What is the next alteration ?-The next alteration is at the end of Subclause (5), on page 102, to insert the words "or by a subsequent order." Those words are added to represent the decision of the Court of Appeal in the case quoted in the note.

273. That

15 July, 1908.]

[Continued.

Chairman-continued.

273. That again was a decision on the construction of the Act?—Yes.

66

274. Is there any other alteration in the clause? -Yes, in Subclause (6) in lines 34 and 35 the words or in the case of a winding-up in Scotland the Companies Clauses Consolidation (Scotland) Act, 1845," are new.

275. You propose to insert those on the ground that the omission of the Scottish Act would appear to have been inadvertent ?-Yes.

[Chairman.] Two of the amendments proposed on this clause are incorporating glosses upon the words of the Statute. I think we have already settled that point on previous clauses: on previous clauses: we will leave the words as they were and the gloss as it was the one will control the other. Then the last amendment proposed is clearly an alteration-it is admittedly new legislation. We will omit the We will omit the words in Subclause (6), but I will note the case in the proposed schedule.

Chairman-continued.

suggest an amendment which I referred to when we were dealing with Clause 123 at the opening of the proceedings to-day.

283. What is the amendment ?-It is suggested to insert at the beginning of Subsection (2), in line 27, the following:-"A winding-up subject to the supervision of the Court is not a winding-up by the Court for the purpose of the following provisions of this Act, namely, those contained in Sections one hundred and forty-four, one hundred and forty-eight, one hundred and forty-nine, one hundred and fifty (except Subsection 10), one hundred and fifty-three, one hundred and fiftyfour, one hundred and fifty-five, one hundred and fifty-six, one hundred and fifty-seven, one hundred and fifty-eight, one hundred and fiftynine, one hundred and sixty, one hundred and sixty-one, one hundred and sixty-two, one hundred and sixty-three, one hundred and seventy-four, one hundred and seventy-six, but."

284. There is a certain sin which is committed in Acts of Parliament, namely, legislation by reference, and this seems to me a fearful specimen of that? We have done our best to reproduce exactly the existing law in this particular. We do not know how to do it better.

Lord Balfour.

285. It is not so bad a case of legislation by reference in one respect, namely, that it is reference to the same Statute that we have in hand, whereas in some cases it is reference to half-adozen different Acts of which one has to obtain copies in order to follow it. The reference here is to sections in the same Act ?-That is so.

Chairman.

286. Why should you not say simply “ a winding up subject to the supervision of the Court is not a winding up by the Court for the purposes of this Act"? That would be far too wide. What is being done here is to reproduce Section 31, Subsection (2), of the Companies (Winding-up) Act, 1890, which is to the following effect: "For the purposes of this Act" (that is to say the Act of 1890) "a company shall not be deemed to be wound up by order of the Court if the order is to continue a winding up under the supervision of the Court." We have therefore to confine this to the provisions of the Act of 1890 which are reproduced in the Bill. It does not extend to the provisions of the Act of 1862 which are reproduced.

287. You might have said "for the purpose of this Act" if we were simply consolidating the Act of 1890, but when you bring in these other Acts you must specify the sections?—Yes. 288. Very well. Then I am afraid we must let have this. I do not see any you of other way doing it except by inserting the numbers of the clauses in this way?-Some of these numbers may be wrong now, as I believe the Committee have left out one clause in the Bill; but I I may correct the numbers.

presume

289. Certainly. You will bring them into conformity with the numbers in the Bill as amended?--Yes.

290. Have

15 July, 1908.]

ON CLAUSE 205.

Chairman.

290. Have you anything to say about Clause 205? -That is all right, I think. This only gives effect to the existing law, having regard to the Act of 1900.

[Chairman.] Then that may stand.

ON CLAUSE 208.

Chairman.

291. On Clause 208 you say in your note, "Subclause (2) of Clause 208 is new and gives effect to the dictum of Lord Selborne in a certain case? -Yes.

292. Is it a dictum of Lord Selborne relating to the general law or to the Statute law?—It is a dictum in re Milan Tramways Company. (25 Ch. D., (p. 591.)

(After some discussion.)

[Chairman.] It appears that it was an inevitable gloss upon the words of the Statute. That is covered by the rule we have already laid down for ourselves. We cannot introduce this in a Consolidation Bill. We will omit Subclause (2).

ON CLAUSE 210.

Chairman.

293. Then in Clause 210 there is another case

of the same thing. The word "next" is supplied before the word "before "in Subclause 1 (B) and (c) and reference is made to re Smith (17 Q.B.D. 4). We cannot accept the insertion of the word "next"?-I suppose not.

294. I understand it is the wish of some members of the Committee that the case should be noted in the proposed Schedule for consideration afterwards, and I will therefore make a note of it. Is that all upon this clause ?-There is a point on Subclause (4) which I think is worth considering in Lord Balfour's proposed schedule. The enactment reproduced in Subclause (4) is, whether intentionally or not, so framed as not to extend to voluntary winding up.

[Chairman.] I will note the point. Mr. Beale.

295. I observe in this Clause 210 you introduce the expression "the said date "?-Yes, that is necessary.

296. Does it correspond in all places?-We have done our best to give effect to the language of the Act of 1867, which alters the date.

297. It is very difficult to trace the exact correspondence between the old Act and the new. The said date is the date hereinafter mentioned in Subclause (5) ?-The date is different in the case of compulsory winding up and in the case of voluntary winding up-that is the difficulty. [Chairman.] Very well, that will stand.

Mr. Stewart Smith.

298. I see in your note at the top of page 19 reference is made to the Workmen's Compensation Act, 1906, and you say that for the sake of com

[Continued.

Mr. Stewart Smith-continued. pleteness paragraph D has been inserted in Subclause (1) of this clause ?-Yes.

Chairman.

299. That seems to be introducing part of a general Act, is it not? The Workmen's Compensation Act constitutes certain preferable debts as against everybody. You introduce them into the Companies Consolidation Act?-I think there is no doubt whatever that paragraph D does really represent the existing law. My own wish was not to put it in here, but it was represented to me by a great many people that it was extremely inconvenient (as you could put it in) not to put it in here. I think it certainly represents the existing law.

300. What we are doing here is consolidating the Companies Act ?-That is so; but there are various Acts which are not called Companies Acts, but which do in effect alter the Companies Acts; and this is one of them. (Mr. Barnes.) This is part of the law relating to Joint Stock Companies.

301. Of course the difficulty of consolidation always is that there are no watertight compartments in law, even in Statute law; and a lot of other branches of law and other Statutes impinge upon and affect the particular question, and the point is whether you will introduce all of them, or any of them, or none of them. Here is a case in point; there are preferences given by the Companies Acts and there are preferences given by the Workmen's Compensation Act, and the question is: Are you to include the Workmen's Compensation Act preferences in a Companies Consolidation Bill?-Quite so.

Mr. Arnold Herbert.

302. That clause is really a Company Law clause, only it happens for convenience to have been put into the Workmen's Compensation Act?--Yes.

Chairman.

exclusively to companies?-No, it does not 303. (To Mr. Graham-Harrison.) Does it apply apply exclusively to companies.

304. It applies all round?-If you keep it here you have in this clause a complete statement of the law as to preferential payments in the case of companies.

Lord Stanley of Alderley.

305. It still remains in the Workmen's Compensation Act?-It remains in the Workmen's Compensation Act just as it was. It is not proposed to repeal any part of the Act of 1906.

Chairman.

306. No doubt it is very convenient. It must of course be happening constantly in other cases; but is there any other case of this kind in this Bill?-I do not think so.

307. It would seem to be out of place in the Workmen's Compensation Act?-What this particular section in the Workmen's Compensation Act did was to amend sections in the "Preferential Payments in Bankruptcy Act," 1888 and 1897, which are the sections reproduced here.

308. So